COSTA MESA, Calif.—Eleven percent of cardholders report they changed primary credit cards in the past year, according to data from J.D. Power. And the main driver of switching is clear: rewards.
Amid the current rewards battle among major issuers, 56% of customers who switched cards said that they switched for a better rewards program or to take advantage of a sign-up offer, J.D. Power said.
“Credit card companies are forever searching for the right mix of benefits that will allow a card to both entice new applicants and keep longtime cardholders in the fold while still turning a profit. That last part is key. Sure, a card could offer a huge sign-up bonus, a 0% APR period, no annual fee, a low ongoing interest rate and high spending rewards. It would appeal to everyone, but it would also lose money. There's only so much value that the issuer can afford to give to the consumer,” said NerdWallet in its analysis of the J.D. Power data.